Nvidia caught our eye the other day as it was about to become the best performing stock in 2016. Its Q4 earnings were good (up by about 50%), so the stock “shoots up” as the investing community is amazed and surprised. The chart on the left is semi-log and the one on the right arithmetic. They do visual stuff, whatever that means.

We see a triangle in the semi-log chart and an almost vertical rise in the normal chart, leaving behind a gap at around $ 70 or so. Triangles lead to a thrust which is then fully retraced and gaps that want to be closed. That gives a target between about $10 and $70. Either way sticking around for a few extra bucks is not worth it!

Note; There is a slight overlap between the top of wave 1 and the end of the triangle wave 4, that is, strictly speaking a no no. But even so there is an eight year congestion period and this would result in performance similar to a triangle.

Back in Sept. we suggested this stock would be a buy next time it hit a low at roughly $11. It got to $11.47 so you may have missed it. It should climb at least $5, most it has already done, and then it remains to be seen if this is it or that we are only completing wave 4 of C. Sell between $15/16.

On the left the chart from june. It was then expected that the stock would trade to the trend line connecting the lows.I had not looked at it for a while but certainly came close $11.75. The question now is will it still do that or is it already in the next up leg. Not sure but should it get to , say, $11 now then it is definitely a buy for $5 to $10 up.

This was back in Febr. 2011. The stock was trading at a P/E of 56, not that that matters. The chart showed a very , very, clear A-B-C corrective retracement of the big drop. Furthermore, it retraced a rather intriguingly precise 62% and reached the wave 4 or wave B level. I have shown dozens of these together with at least as many B-waves. Sometimes they remain suspended for months, sometimes they go a fraction higher but in most cases they will do the expected. Here is today’s chart;

The stock has dropped from $26 to just above $14, roughly 46% in 4/5 months. The P/E is no longer at 56 but at a more moderate 34 (still high according to the value investors that look for a P/E <10). On this move the stock might reach $10 where it hits the line and coincidentally again retraces 62% of the retracement. It may not quite get there in this bullish environment. In the end the stock could drop to $3 or so but if it does, it is unclear how it does it, so I would suggest leaving it alone at around $11.

I have no idea what this company does other than that it is in the semiconductor business. A look at the SOX index may add light to this analysis.